Twitch to Shut Down in South Korea Citing Skyrocketing Operating Costs

Twitch to Shut Down in South Korea Citing Skyrocketing Operating Costs

Twitch announced they are shutting down service in the country starting February 27, 2024 due to crazy high operating costs there.

In a blog post, the Twitch CEO explained how it’s just too expensive for them to keep running in South Korea. Even after trying things like lowering quality to 720p, their network fees are still 10X higher than most other countries. Twitch has been losing money there for a while and couldn’t find a sustainable path forward.

This really stinks for all the Korean streamers who have put in so much time building their communities on Twitch. To try and ease the blow, Twitch plans to help folks move to other Korean live streaming platforms. They’re also talking to those platforms to facilitate the transition and will communicate plans to affected streamers.

Twitch isn’t the only company struggling in South Korea. Netflix also had major issues with network fees there until finally reaching a deal last year.

The root cause seems to be Korean ISPs forcing content providers to pay crazy high network fees for the traffic they send over the ISPs’ networks. So it ends up being way more expensive to operate services like Twitch and Netflix in South Korea compared to other countries.

So in summary – Twitch pulling out of South Korea in 2024 due to excessive costs. They’re trying to help streamers migrate, but it’s still a huge bummer. Goes to show how tricky global expansion can be for internet companies when local laws and fees make certain markets prohibitively expensive to operate in.